Tokyo, Sept. 27 (AFP): Japanese electronics giant Sony Corporation said today it will merge with its ailing subsidiary Aiwa Co. Ltd. on December 1 instead of just taking 100 per cent ownership after radically restructuring the company.

“Although the integration of Aiwa’s operations into Sony has proceeded smoothly, it was decided that a complete unification of the two companies by merger would be the best,” the firms said in a statement.

Aiwa’s factories in Malaysia and Indonesia have been shut down, and its domestic production and sales have already been absorbed into Sony’s, the statement said.

Some 600 of Aiwa’s remaining 1,100 permanent employees will have been laid off by October and nearly all Aiwa sales subsidiaries are in the process of closing, with sales and services being conducted by Sony in Asia, West Asia and the United States, it said.

The move means Aiwa will cease to exist as a company in its own right and become a sales division of Sony, although Sony said the Aiwa brand name would survive on products.

“As a result of the merger, the Aiwa and Sony brands will both grow in strength under a unified electronics strategy which will enhance corporate value for the entire Sony group,” it said.

Last month, Sony said it would inject 45 billion yen ($ 68.9 million) into Aiwa while purchasing 180 million new share issues before taking 100 per cent control from October 1.